E The Daily Shot And Data - July 7, 2016 -


Let's begin with more "unintended consequences" of Brexit as the UK property funds continue to hound the financial sector.

1. Some $23 billion worth of property assets is now frozen after seven funds put up gates.

Source: Reuters

2. Moreover, certain funds are sharply marking down their portfolios. Welcome to "dilution adjustment" as Aberdeen cuts its property fund NAV by 17% and suspends redemptions.

Source: Aberdeen

3. Traded UK property assets such as this ETF (below) have tumbled. Could this shift out of British real estate spill over into other frothy property markets? Hong Kong, Syndey, Toronto, San Francisco?

Source: Google

4. Firms who suspend redemptions see their shares take a hit. Please, please don't dump my stock ...

Source: The Telegraph

Source: Bloomberg.com

5. European banks remain under pressure.

Source: Investing.com

6. Deutsche Bank shares continue with their daily decline while CDS spreads widen.

Source: Google

Source: @MktOutperform

7. Italian banks are down another 2% on Wednesday and 56% year-to-date. Brutal.

8. Of course, the rout in the financial sector is not limited to Europe. Here are Japanese financials.

Source: Google

1. Staying with the UK, here is the Brexit decision tree from Nomura. Easy ...

Source:  ‏@EMgist, Nomura

Note that in the near-term the paths do not matter much because the economic damage due to elevated uncertainty has already been done.

2. The UK financial stress is now visible in the elevated GBP Libor - OIS spread.

Source: ‏@Schuldensuehner

3. The British pound devaluation impact on the equity markets discussed yesterday remains in place as the FTSE 100 and the FTSE 250 diverge.

Source: ‏‏@fastFT

4. Auto purchases slowed prior to the EU Referendum on higher uncertainty. It will be interesting to see what this looks like for July.

Source: @telebusiness

5. According to the FT, some 700k fewer jobs are now advertised online than before the referendum. This report may be an indication of significant damage to the whole UK labor market.

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